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The weak pound is expected to give a big boost to first-half profits at British American Tobacco, which said it had started the year “very well” despite expected declines in sales volumes across the tobacco industry.
In a pre-close trading update on Wednesday, the company said earnings per share for the first half would receive a tailwind of around 14 per cent from currency translation effects.
In terms of the underlying business, BAT said it expects profit growth to be weighted to the second half of the year, but said it had still gained market share in the first half.
The company did not give precise details on sales volumes, but said its full-year volumes are expected to outperform the wider industry, which it expects to be down around 4 per cent.
BAT’s cigarette volumes were practically flat last year.
It is pushing to grow its e-cigarette business to help offset declines in some cigarette markets, and today it said it was making “encouraging progress” with new vaping products in Japan and western Europe.